Suit Of Former Mack Official Is Ended Court Drops Action Of Financial Branch Chief Who Quit Over Fraud Claim

May 18, 1985|by BOB SHARPE, The Morning Call

A 2-year-old lawsuit brought by the former president of Mack Financial Corp., whose resignation arose over an alleged $5 million fraud within the Mack Trucks subsidiary, has been dismissed in Lehigh County Court.

Wallace P. Vogler, in a suit filed against Mack Trucks Chief Financial Officer Guy D. Coffelt, had accused Coffelt of making false and malicious statements that resulted in Vogler's forced resignation in March 1983.

Judge Maxwell E. Davison, dismissing Vogler's complaint, ruled that Coffelt's statements did not "discredit or disparage the plaintiff's professional reputation," and were "constitutionally protected opinions expressed by a supervisor about a subordinate's performance."

Davison also ruled that Coffelt, as Mack Financial's senior corporate officer, had been entitled to request Vogler's resignation without prior approval from Mack Truck's board of directors.

According to court documents, Coffelt demanded Vogler's resignation after Coffelt and other Mack Trucks officials learned of the multi-million-dolla r fraud in Mack Financial's Pittsburgh office.

A March 27 Call-Chronicle article detailed Mack's allegations that one or more employees in the Pittsburgh office, a Mack Truck dealership in Somerset County, and a Pittsburgh-area trucking company took part in the fraudulent financing of more than 100 trucks.

As a result of the scheme, Mack said, Mack Financial made loans to truck buyers for amounts that far exceeded the true value of the trucks. And in some cases, Mack said, Mack Financial financed the sales of trucks which were never owned by the Somerset County dealership.

Vogler has not been accused by Mack of being involved in the fraud. His resignation came a few weeks after he learned of the fraud, documents state.

Documents state Coffelt requested Vogler's resignation because he had lost confidence in Vogler for not immediately informing him of the fraud once it was uncovered.

Vogler said in court documents that he wanted to learn more about the fraud, and have a solution to the problem, before telling Coffelt and other Mack officials.

Mack Trucks earlier this year filed a lawsuit against Vogler, claiming $150,000 damages for the cost of having Mack Financial's books audited after the fraud was revealed. The suit is still pending.

In saying that Vogler failed in his fiduciary duties, Mack's suit said it had to audit the books after losing confidence in Vogler and Mack Financial management.

Davison also dismissed a related lawsuit that Vogler filed against Mack Financial and the Signal Cos. Inc., which owned Mack Trucks at the time.

Davison ruled that Signal did not lose its right to terminate Vogler when it granted Vogler stock options in December 1982. Vogler contended that by accepting the stock options he was guaranteed employment for one more year.

Vogler has 20 days to file amended complaints, said Davison, who dismissed the lawsuits on May 10.